Rare Coin Company goes bust

[lacey]

kel if you are on a pension and still have some super left, have it changed over to a pension and then you will still get Govt pension without penalty.  If you get your super changed to a pension, you can nominate how much you get each month (I think it's from 4% up 10%), depending on how much you have in there.

[accumulator]

The thing that worries me about a big concern going under is, is it the whole industry thats not as strong at the moment ?  or is it bad management ?
Like, surely if they've been operating for 30 years & a fair bit in the high end of the market then they really should have a pretty good grip on things,so what happened ?

[Goldseeker]

Greedy managers getting whopping great pay rises at the expense of the investor/little man, meaning you and me.

[markn]

The thing that worries me about a big concern going under is, is it the whole industry thats not as strong at the moment ?  or is it bad management ?
Like, surely if they've been operating for 30 years & a fair bit in the high end of the market then they really should have a pretty good grip on things,so what happened ?

Who can say.  But if you read the articles relating to both Rare Coin Company and John Petit Banknotes there's one common factor that stands out.  They both offered guaranteed buy backs and rates of return on coin/banknote purchases.

[keldaw]

sure lacey , that sounds good but as I said , I have drawn it all out of super and we went on a big holiday with my whole family to Fiji ,
 that was so good and even to see the grand kids enjoy the plane ride over there was so good , the rest was put into terms deposit at 4 %
 not much I know but  at least I know what I will get back in 12 months , but with super you don't have a clue .. and my super earnt me nill some years and I lost some of my capital , but with term deposit my capital is guaranteed .. much much better ,,. kel ,,

[Fulvio]

There's a common misconception about business, businessmen and failures. Although there are certainly plenty of shonks, you simply can't generalise and tar everyone with the same brush. No more than you can any other group. There are, for example, honest politicians, hard-working public servants, dedicated unionists, and upstanding citizens who ride motorcycles.

Without going into too much detail, I lost a million dollars when certain St George bank employees got personal and pulled the rug out from under me two weeks before things were going to be resolved. They took my money, everything I owned, they stole property which did not belong to me, they very nearly put my parents in the street, and they caused a string of ongoing health, relationship and personal problems that continue to haunt people 15 years later.

Yet a lot of uninformed people viewed me along the lines of what AJ posted. Which of course added to the fallout.

Unless you know the details of what happened intimately, you really can't judge. There may have been a bank like mine involved. There may have been a crooked employee embezzling. There may have been a poorly timed investment. Or improperly thought-out guarantees. Or any of a thousand other factors which you don't know about. Which even the principals involved may not know about. I certainly didn't find out I had an employee with her hand in the till until it was far too late to do anything about it. Perhaps if I'd known, I'd still be in business. I don't know. And if I don't know, what hope does anyone else who wasn't involved have?

I don't have any great love for dealers, especially at the top end of town. I'm unlikely to support them. But I appreciate that they provide a service, and that they have a right to be in business. When they fail, for whatever reason, I think its bad for everyone, and I feel for any victims or innocent bystanders. But I don't think anyone can judge them on hearsay or prejudices.

Take note, learn, and move on. Then perhaps next time things will go differently. Look at our recently reincarnated fearless leader for example, who actually now has a very good chance of winning an unwinnable election. If he can learn, so can anyone else.

[keldaw]

when I retired 12 years ago , if I had taken my super out , I would get the first $ 105000 .00 tax free and only payed 15% on the rest , but they don't tell you things like that , they want you to invest the lot with them so they get their cut out of it too .
 I would now be  $ 49000.00 better off if they had have told me that ..

 always remember , you only get one try at it , stuff up and it,s gone you are then to old to try again .. so you don't have much of an option
 to chose from . I hope this is of some help to somebody on this forum or to some of their families . if you have a family or friend and they have super invested  , just ask them how much they put in and ring the company now and find out what it is worth now .. they will tell you it is a long time investment , but when you retire at 60 - 65  how much time do you have left ..      ,, kel ,,

[Fulvio]

...they will tell you it is a long time investment...

What super really is is a way to fund a massive population bubble without bankrupting the country. That's all it is. Anything else is incidental, and details have and will change over time.

Without super, there is no way we can raise enough taxes to pay everyone a pension they can actually eat on. Even now, a pension will not allow you to put a roof over your head, or do much of anything else. There are too many old people and not enough young ones. We just live too long.

Is super a good investment? Was it ever? Will it be? Dunno, crystal ball is still on the fritz. But it is a way to shift the massive costs onto other shoulders than the government's. And for most people its effective. You can take it as a pension, add a full or part government pension, and live in some semblance of comfort, maybe.

What you can't do is fund a trip to Vegas, and expect to live like Kim Kardashian on it. But that's not what its for. You're not supposed to take lump sums out of it, and there are deliberate penalties to discourage that.

Personally, I decided decades ago that super was not for me. I still have some, if the management fees haven't devoured it all yet. But I'd rather noodle for my super, and I think in the long run I'll come out ahead. We'll see. And if I got it wrong, well, its nobody's fault but mine, eh?

[Coins from Vending]

if you guys are working and over age 55 I strongly suggest you look at whats called transition to retirement, basically you salary sacrifice as much as you can upto the total super contribution of 35K so if you employer pays 10K you can salary sacrifice 25K into super.

You take all your super from your current fund put it into a fund that allows a draw down each week which takes the place of you salary sacrifice, so you still have the same amount of money coming in each week.

The salary sacrifice component only attracts 15% contributions tax as apposed to your higher tax bracket, this will see you about 6K a year better off due to paying less tax.

I've helped many ppl set this up through suncorp

[trout]

Fools and their money are easily parted.
I have no idea why this particular company went toes up but I would hazard to guess that the main players didn't loose their shirts like the investors :ok:
This sort of thing happens all the time where an investment company comes up with a "sure fire" winner, inevitably the punters loose their shirts and the bookie drives home in his Roller:angel:

Like it has been said before ;
If it looks like BS
If it smells like BS
If it feels like BS
There is a bloody good chance it IS BS

[Nevol]

When I retired in 2006 I took my entire Super benefit in a cash settlement.
I didn't have a lot to invest as I was only in the workforce for 16 years.

I have some invested so If I lose anything, it's my own fault. No bugger was going to get the opportunity to rip me off. I have 100% control over all my money matters.

[enworb]

"Who can say. But if you read the articles relating to both Rare Coin Company and John Petit Banknotes there's one common factor that stands out. They both offered guaranteed buy backs and rates of return on coin/banknote purchases."

I agree. What has got both into trouble is making promises which cant be kept. Its almost impossible to guarantee a certain rate of return and its bound to fail eventually IMO. I bet the major auction houses are rubbing their hands together now that theyll be having many more top end items coming through their doors for sale.

[markn]

"Who can say. But if you read the articles relating to both Rare Coin Company and John Petit Banknotes there's one common factor that stands out. They both offered guaranteed buy backs and rates of return on coin/banknote purchases."

I agree. What has got both into trouble is making promises which cant be kept. Its almost impossible to guarantee a certain rate of return and its bound to fail eventually IMO. I bet the major auction houses are rubbing their hands together now that theyll be having many more top end items coming through their doors for sale.

I think if you guarantee a buy back at a certain rate of return then you're really just borrowing money from your coin/banknote customers.

[enworb]

Thats exactly right mark. Its a crooked system.

[markn]

Thats exactly right mark. Its a crooked system.

If you read the report on John Petit's failure you'll note that profits had been overstated.  I wonder if it went something like this:

Buy Rare Banknote for: $100,000
Sell Rare Banknote for: $500,000
Profit: $400,000*

*Don't mention that now there's a $600,000 liability that has to be paid in 2 years time.